I think it's a reflection of character more than a sign of intelligence, especially since it's hard enough to measure intelligence (i.e speaking any kind of coherent language is a sign of intelligence, completing mundane tasks around the house ect..). You need to have a decent amount of wit to pull off sarcasm effectively, but it doesn't necessarily make you smarter than the guy that doesn't use it. The guy could have a piss poor sense for detecting irony and packaging it into a expression, but he could also be a genius at Computer Hacking.

I only use sarcasm around certain people. Usually it's at work when I'm with people who I know catch on to my sarcasm, or it's at work with the stupid people who think I'm serious. I'm not sarcastic all the time, and I'm not sarcastic around everyone as that'd just be annoying.